Closing costs can feel like a mystery when you are buying or selling a home in Nashville. You want to plan your cash, avoid surprises, and make smart tradeoffs. The good news is most fees are predictable once you know the local norms in Davidson County and how lenders and title companies quote them. In this guide, you will see what buyers and sellers typically pay, how to estimate your total, and where you can confirm the exact numbers for your closing. Let’s dive in.
What closing costs cover in Nashville
Closing costs are the one-time fees and prepaids due when ownership transfers. In Tennessee, your transaction is finalized through a recorded deed with the Davidson County Register of Deeds. The required administrative charges are recording and filing fees for deeds, mortgages, and releases. These fees are set by state and local schedules and vary by document type and number of pages.
Some states charge a separate real estate transfer tax. In Nashville, the primary immediate charges are recording and filing fees. You should confirm whether any conveyance or documentary tax applies to your specific transaction with the Davidson County Register of Deeds or the Tennessee Department of Revenue.
Closings are handled by a title company or a real estate attorney. If you are financing, your lender must provide a Loan Estimate early in the process and a Closing Disclosure at least three business days before closing. Use these documents to verify the final, exact amounts you will pay.
Buyer closing costs in Nashville
Loan costs
- Origination and lender fees: Often 0.25% to 1.0% of the loan amount or a flat fee. On a $300,000 loan, 0.5% is $1,500.
- Discount points: Optional. One point equals 1% of the loan to buy a lower interest rate.
- Credit report: About $25 to $50.
- Appraisal: Typically $400 to $800 depending on property type and size.
- Miscellaneous lender charges: Items like wire or tax service fees often total $50 to $300.
Title and settlement
- Lender’s title insurance: Based on loan amount, often about 0.2% to 0.6% of the loan.
- Owner’s title insurance: Based on purchase price. In many Nashville-area deals, the seller pays this, but it is negotiable.
- Settlement or closing fee: Usually $300 to $800 depending on complexity and local practice.
Prepaids and escrow
- Homeowners insurance: Your first year premium is typically paid at closing. A common range is $800 to $2,000 per year depending on coverage and property.
- Prepaid interest: Prorated from your closing date to your first mortgage payment.
- Property tax and insurance reserves: Many lenders collect 2 to 3 months of taxes and insurance to start your escrow account. Davidson County property taxes are prorated between buyer and seller based on the closing date.
- HOA and condo items: Prorated dues and any transfer or document fees, often $50 to $400.
Inspections and surveys
- Home inspection: About $300 to $600.
- Pest inspection: Often $50 to $200.
- Survey: If required, about $300 to $1,200 depending on the lot.
- Specialty inspections: Items like septic, radon, or a sewer scope vary.
Recording and local fees
- Recording the mortgage or deed of trust: The Register of Deeds charges per document and page. Single-document costs often fall in the low tens to low hundreds of dollars.
- Confirm any additional county or state charges for your specific transaction with the Register of Deeds.
Buyer total range
As a rule of thumb, buyers should budget about 2% to 5% of the purchase price for closing costs, not including the down payment. The lower end assumes few prepaids and no discount points. The higher end reflects points, bigger escrow reserves, and more inspections.
Seller closing costs in Nashville
Real estate commission
Commission is often the largest seller expense. A common range is 5% to 6% of the sale price, split between listing and buyer representation. The rate and splits are negotiable.
Owner’s title policy
In many Nashville transactions, the seller pays for the owner’s title insurance policy. This is a one-time premium based on the sale price and is a customary practice, not a legal requirement. It can be negotiated in the purchase agreement.
Payoffs and prorations
- Mortgage payoff: Any outstanding loan balances and applicable lender fees are paid from your proceeds. The title company coordinates payoffs and lien releases.
- Prorations: Property taxes and HOA dues are prorated through the closing date. Utilities may be prorated as well based on final readings and local practice.
Recording and transfer-related fees
- Recording fees for deed and release documents are typically modest, often $50 to $200 per document.
- Confirm any additional county or state charges with the Register of Deeds.
Repairs and concessions
Sellers sometimes agree to repair items or provide a credit in lieu of repairs. You can also offer a credit toward the buyer’s closing costs if allowed by the buyer’s loan program.
Seller total range
Excluding commission, sellers often spend about 1% to 3% of the sale price on closing costs. Including commission, many sellers land in the 6% to 9% range, depending on concessions and repairs.
Who pays what in Davidson County
Customs can vary by neighborhood and market conditions, but these patterns are common in the Nashville area:
- Buyers usually pay lender fees, the appraisal, inspections, and the lender’s title insurance policy.
- Sellers often pay the owner’s title insurance policy and real estate commission.
- Recording fees and smaller charges are allocated by the purchase contract. Use local contract forms and your title company’s settlement statement to confirm who pays each item.
- Seller credits to the buyer are common and can help with closing costs. The amount may be limited by the buyer’s loan guidelines, so check with the lender.
Always rely on the purchase agreement, the title company, and the lender’s disclosures to finalize the allocation.
How to estimate your numbers
Quick method
- Ask your lender for a Loan Estimate showing all origination fees, appraisal, and prepaids.
- Request the title company’s rate table for the owner’s and lender’s title policies plus the settlement fee.
- Add inspection costs and any survey if needed.
- Estimate prepaids and escrow reserves for insurance and property taxes based on local tax timing and premium quotes.
- Add recording fees for the deed and mortgage.
Illustrative estimate at $400,000
These are illustrative estimates. Always verify with your lender and title company.
Buyer at $400,000 purchase price with 20% down and a $320,000 loan:
- Lender fees and points: $1,600 to $3,200
- Appraisal: $450 to $700
- Lender’s title insurance: About $1,000 to $2,000
- Settlement fee: $400 to $700
- Inspections and survey: $400 to $1,200
- Prepaids and escrow reserves: $2,000 to $5,000
- Recording fees: $100 to $300
- Estimated buyer total: About $6,000 to $13,000
Seller at $400,000 sale price:
- Commission example at 5%: $20,000
- Owner’s title insurance: About $1,500 to $2,500
- Prorated taxes and recording or payoff fees: $1,000 to $3,000
- Repairs or concessions: Variable
- Estimated seller total excluding commission: About $2,500 to $7,000
Ways to lower closing costs
- Ask for seller credits. You can negotiate a credit toward buyer closing costs within loan program limits.
- Compare lenders. Small differences in points, origination, and rate can save you thousands over time.
- Shop title and settlement fees. Title premium schedules are standardized by insurer, but settlement fees can vary.
- Time your closing date. A late-month closing can reduce prepaid interest. Prorations for taxes and HOA dues also vary with timing.
- Explore assistance. The Tennessee Housing Development Agency and local programs may offer down payment or closing cost help if you qualify. Check program rules early.
Local resources to confirm fees
- Davidson County Register of Deeds for current recording fees and requirements.
- Davidson County Trustee or Assessor for property tax rates and billing schedules.
- Tennessee Department of Revenue for any state-level conveyance or documentary tax details.
- Tennessee Housing Development Agency for buyer assistance programs.
- Greater Nashville REALTORS for local customs and contract practices.
- Local title companies and lenders for rate tables, settlement fees, and Loan Estimates.
Smart questions to ask
Questions for your lender
- Can you provide a sample Loan Estimate showing all origination fees, points, appraisal, and prepaids for my scenario?
- How many months of taxes and insurance do you require in escrow at closing?
Questions for your title company or closing agent
- Please provide your title insurance rate table for owner’s and lender’s premiums and a breakdown of settlement or closing fees.
- What are Davidson County’s current recording fees for a deed and a mortgage per document and per page?
- Who is customarily expected to pay the owner’s title policy in Davidson County?
Questions for the seller or listing agent
- Will the seller be paying the owner’s title insurance policy and any recording fees?
- Is the seller offering any credits toward buyer closing costs?
Questions for local offices
- What is the current property tax rate and billing schedule for this parcel in Davidson County?
Ready to run the numbers?
Closing costs in Nashville are manageable when you know what to expect and who pays what. Start by requesting a Loan Estimate from your lender and a title rate quote and settlement fee from a local title company. Then plug in inspection costs, prepaids, and recording fees to arrive at a clear budget. If you want tailored guidance and a smooth, concierge-level process from offer to keys, connect with Angela McAndrew. Schedule Your Personalized Consultation.
FAQs
Who typically pays the owner’s title policy in Nashville?
- In many Nashville-area transactions, the seller pays the owner’s title policy, but this is negotiable and should be confirmed in the purchase agreement.
How much should a Nashville buyer budget for closing costs?
- Buyers often plan for about 2% to 5% of the purchase price, not including the down payment, depending on loan program, prepaids, and inspections.
When will I know my exact buyer closing costs?
- Your lender must deliver a Closing Disclosure at least three business days before closing that lists your final numbers, and the title company provides the settlement statement.
Can a seller help pay my closing costs in Davidson County?
- Yes, seller credits can be written into the contract, but the total is limited by the buyer’s loan program rules, so check with your lender.
Are there Tennessee transfer taxes I should plan for?
- The primary immediate transaction charges in Nashville are recording and filing fees; confirm any conveyance or documentary taxes for your specific deal with the Register of Deeds or Department of Revenue.
